“Have you ever backed out of a deal and why?” – Jett of Shoreline, WA
I’ve never backed out of a deal that I’ve waived feasibility on. I always do all of the due diligence up front to make sure that the property works for us, and once we’ve committed deposited earnest money that is non-refundable, we’ve closed on everything. While I’ve been in feasibility or in the inspection period on a property, issues have come up and I’ve needed to let go. For example, I had a property that needed to be connected to sewer and was currently on septic. The seller wasn’t willing to negotiate a reduction when I wouldn’t have known about the issue prior, so that’s something I quickly determined wouldn’t work for me. Also, if we dug into a property and found out there was a lot of rot or structural issues that we weren’t expecting; (as we typically are expecting to do all of the cosmetic renovations) those can sometimes be an indicator that the property doesn’t work for us. In those instances, we don’t consider it backing out, we just consider it a dissatisfaction of feasibility or inspection. Occasionally in those situations we’ll ask for a price reduction, but if the owner isn’t willing to cooperate we wouldn’t close.